How Do Customers React When Notified to Forward Their Payments to a Factor?
This is not a problem if the notification is done in a positive and professional manner. JMG Financial Solutions will guide you and even provide sample letters which have successfully been used in the past to insure a smooth transition in payment arrangements. Maintaining your customer’s “goodwill and confidence” are of utmost importance!!! Back to Top Can I Factor My Invoices Without Notifying My Customers? Yes, it is known as confidential or non-notification factoring when the factor takes assignment of accounts receivable without advising the client’s customers of the financial arrangement. The client continues to handle all collections and the payment to the factor. This type of arrangement places the factor at greater risk and is not accepted by most factors in the industry. The fees tend to be higher, and the guidelines more stringent because of the risk. Most importantly, the company being factored would forfeit some of the most valuable benefits of factoring – being relieved of
